Paytm Mall gets $2 bln costing in $500 mln funding round

Online marketplace Paytm Mall is likely to be valued at $2 billion as it racks up capital from Soft-Bank, people close to the matter said. SoftBank may be joined by Chinese investment fund Primavera Capital Group and Singapore government’s sovereign wealth fund Temasek in a $500-million financing round at the company, sources said. The Japanese investor is expected to plough around $400 million in the financing round, while PrimaveraCapital and Temasek are still in discussions to finalize their participation.

This will be the first external funding for Paytm Mall after it was spun off from One97 Communications. Paytm e-commerce is a spun-off entity of One97, which announced the launch of Paytm Mall in February last year.

Though the news has been doing the rounds in media for the past few month, according to the new report, the funding round is set to close in the next four to six weeks.

However, the newspaper couldn’t get the confirmation from any of the stakeholders.

Last year, Alibaba and SAIF Partners had pumped-in $177 million and $23 million respectively into Paytm Mall. Currently, Alibaba holds over 50 per cent stake in Paytm Mall.

The e-commerce platform has been continuously enhancing the product and eyeing to emerge as one of the main players in the e-commerce space. It has been trying every maneuver to establish a faithful customer base. Thus, it has been betting big on O2O (online-to-offline) commerce.

The company hopes to take on Amazon India, which gets more than 50 percent of its daily grocery orders and is running a number of programmes, including Amazon Pantry and Amazon Now, its two-hour grocery delivery service. “The biggest learning that I have got is that grocery is the fastest growing category in e-commerce. The consumers come back again. We have a daily needs section in Paytm Mall for that reason. At present level, around 25 per cent of the GMV at Paytm Mall comes from grocery; it will go up to 40 per cent. I think groceries would contribute around $3-billion GMV by end of the year,” Sharma had earlier said.